Budget may target pensions of bankers, says Minister

Minister for Communications Pat Rabbitte has hinted at action in the budget to curtail high pensions going to bankers.

Although he warned that the Government was constrained by the property right concerns, he suggested there was still scope for Ministers to act.

“Difficult and all as it is to explain, it is the case that we have to be proportionate,” Mr Rabbitte told reporters in Brussels.

“I don’t even seek to justify the remuneration packages – including pension entitlements – of senior bankers: I mean people on three times what the Taoiseach earns, whose contribution seems to have been to allow the credit bubble to expand to such an extent that it threatened the entire economy.”

Asked whether the Government was at the absolute limit of what it could do, he said it was not. “I’m saying that anything we do will have to be creative and will have to withstand challenge,” he said.

“That drags me into discussion that I can’t engage in, in respect of a little event that’s only three weeks away or so. So I’m not going to go there,” he said.

“The Government finds the remuneration packages of the leaders of the banking community as unacceptable as other taxpayers. But we are constrained in what we can do.”

Asked directly if this was an issue the Government may tackle in the budget, he said: “It’s an issue that the Government is concerned about. I don’t readily have a solution to it.

“But we share the concern that is out there, both in respect of pay and particularly in respect of the pensions of those retired senior bankers who contributed so much to the collapse.” However, this was a very difficult question to address given the constitutional protection of private property.

Asked about suggestions the Cabinet and junior ministers should take a cut in their pension entitlements, Mr Rabbitte said the first thing the Government decided on the night it took power was to cut pay.

He also noted that political pensions had been revamped so they were not paid until the age of 65, which was not the case in the past.

“As regards the existing entitlements of Ministers and Ministers of State, I think the Government is sensitive to the criticism,” he said.